Dismissal of an employee

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  • Dismissing employees is the act by the employer of terminating their employment on the ground of just causes and after observance of substantive and procedural due process.
  • While a management prerogative, it is subject to the two-fold limitations of good faith and employee rights.

Concept of dismissal of an employee

Dismissing employees is the act by the employer of terminating their employment on the ground of just causes and after observance of substantive and procedural due process.

Just causes include serious misconduct, willful disobedience, gross and habitual neglect of duty, fraud, willful breach of trust, commission of a crime, and analogous causes. The Labor Code authorizes the employer to terminate the employment of an employee who is found to have committed any of these just causes.

Dismissal, highest form of penalty

Penalties usually range from verbal reprimand, written warning, suspension, to dismissal. Thus, dismissal is the highest form of penalty that an employer may impose as a penalty for an erring employee as this will result in the severance of the employer-employee relationship.

Penalty, commensurate to the offense

The Supreme Court has repeatedly held that the penalty of dismissal should be exercised humanely and considerately, as well as to ensure that the sanction is commensurate to the offense.

“Although we recognize the inherent right of the employer to discipline its employees, we should still ensure that the employer exercises the prerogative to discipline humanely and considerately, and that the sanction imposed is commensurate to the offense involved and to the degree of the infraction. The discipline exacted by the employer should further consider the employee’s length of service and the number of infractions during his employment. The employer should never forget that always at stake in disciplining its employee are not only his position but also his livelihood, and that he may also have a family entirely dependent on his earnings.” (Dongon v. Rapid Movers and Forwarders Co., Inc., G.R. No. 163431, 28 August 2013)

Hence, in a case involving truck a helper leadman who was dismissed for lending his company ID to the truck driver for them to do their work in a warehouse under the control of their company’s client, it was held that the penalty of dismissal was not commensurate to the offense and thus the employer was held liable for illegal dismissal. “Considering that (the employee’s) motive in lending his company ID to (the truck driver) was to benefit (the Company) as their employer by facilitating the loading of goods at the Tanduay Otis Warehouse for distribution to (the employers’) clients, and considering also that (the employee) had rendered seven long unblemished years of service to (the employer), his dismissal was plainly unwarranted. The NLRC’s reversal of the decision of the Labor Arbiter by holding that penalty too harsh and disproportionate to the wrong attributed to him was legally and factually justified, not arbitrary or whimsical. Consequently, for the CA to pronounce that the NLRC had thereby gravely abused its discretion was not only erroneous but was itself a grave abuse of discretion amounting to lack of jurisdiction for not being in conformity with the pertinent laws and jurisprudence. We have held that a conclusion or finding derived from erroneous considerations is not a mere error of judgment but one tainted with grave abuse of discretion.” (Dongon v. Rapid Movers and Forwarders Co., Inc., G.R. No. 163431, 28 August 2013)

Discretion on employer

“Even if a just cause exists, the employer still has the discretion whether to dismiss the employee, impose a lighter penalty, or condone the offense committed.” (Maula v. Ximex Delivery Express, Inc., G.R. No. 207838, 25 January 2017)

“… while the law provides for a just cause to dismiss an employee, the employer still has the discretion whether it would exercise its right to terminate the employment or not. In other words, the existence of any of the just or authorized causes enumerated in Articles 282 and 283 of the Labor Code does not automatically result in the dismissal of the employee. The employer has to make a decision whether it would dismiss the employee, impose a lighter penalty, or perhaps even condone the offense committed by an erring employee.” (Santos v. Integrated Pharmaceutical, Inc., G.R. No. 204620, 11 July 2016)

Past offenses, totality of circumstances

The employer may consider and factor in past offenses in considering the proper penalty to impose on an erring employee.

In a case involving a clinician who was repeatedly reprimanded for various infractions, it was held that these previous offenses may be considered and factored in the imposition of the penalty of dismissal.  “In making a decision, the employer may take into consideration the employee’s past offenses. In this case, (the employee) had been forewarned that her failure to correct her poor behavior would be visited with stiffer penalty. However, she remained recalcitrant to her superiors’ directives and warnings. Thus, (the employer) came “to a forced conclusion to terminate (her) employment.” (Santos v. Integrated Pharmaceutical, Inc., G.R. No. 204620, 11 July 2016)

Two facets of dismissal

“Dismissal from employment have two facets: first, the legality of the act of dismissal, which constitutes substantive due process; and, second, the legality of the manner of dismissal, which constitutes procedural due process.” (Maula v. Ximex Delivery Express, Inc., G.R. No. 207838, 25 January 2017)

Burden of proof

“The burden of proof rests upon the employer to show that the disciplinary action was made for lawful cause or that the termination of employment was valid.” (Maula v. Ximex Delivery Express, Inc., G.R. No. 207838, 25 January 2017)

Substantial evidence

“In administrative and quasi-judicial proceedings, the quantum of evidence required is substantial evidence or ‘such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.’” (Maula v. Ximex Delivery Express, Inc., G.R. No. 207838, 25 January 2017)

“Thus, unsubstantiated suspicions, accusations, and conclusions of the employer do not provide legal justification for dismissing the employee. When in doubt, the case should be resolved in favor of labor pursuant to the social justice policy of our labor laws and the 1987 Constitution.” (Maula v. Ximex Delivery Express, Inc., G.R. No. 207838, 25 January 2017)

Limitations of management prerogative

In every exercise of management prerogative, the limitations of good faith and employee rights should be observed by the employer to avoid abusing its right to regulate all aspects of employment. Non-compliance with the limitations may render void the exercise of management prerogative and thus open the employer to liability for violating labor laws.

References

  • Presidential Decree No. 442, a.k.a. Labor Code
  • Jurisprudence or Supreme Court Decisions