764 Phil. 694
[Respondents] Marilyn Domrique and Carina Leaño started working for [petitioners] as [photocopy] machine operators on February 21, 1993 and January 1996, respectively. They were assigned at [petitioners'] branch located at Brgy. 10, A.G. Tupaz Ave., Laoag City. [Respondent] Domrique received a salary of P145.00 per day or P200.00 per day [which includes an allowance of P55.00], while [respondent] Leaño received [a salary of] P120.00 per day. They also earn 7% of the total earnings of the branch per month and were provided with free board by [petitioners]. [Respondent Domrique] was assigned to handle one (1) liquid and one (1) powder photocopying machine. She was also tasked as the custodian of photocopying materials such as bond papers and toners. [Respondent] Leaño, on the other hand, handled one (1) liquid photo copier and was assigned to keep the money collected from the customers for the period covering October 1-31, 2005.On February 28, 2006, the Labor Arbiter (LA) assigned to the case rendered a Decision in favor of respondents. The dispositive portion of the said Decision reads, thus:
On October 12, 2005, [respondent] Leaño, together with another employee, Grace Lorenzo, sent a formal letter to the Regional Director of the Department of Labor and Employment (DOLE), San Fernando City, La Union complaining about the alleged labor standards violations committed by [petitioners]. Consequently, on October 18, 2005, the Labor Inspector of the DOLE conducted an inspection of the company premises and based on his inspection report, there were certain labor standards violations committed by [petitioners, among which are underpayment of wages, 13th month pay, overtime pay, holiday pay and service incentive leaves].
On November 2, 2005, Susana Montano, the manager of the establishment and the wife of [herein petitioner] Virgilio Montano, ordered an audit of their branch in Laoag City. As the manager of [petitioner] Copy Central, she makes routinary check up and inspections of its branches to check the meter readings attached to the photocopying machines. Such meter readings indicate the number of documents being copied at the rate of P1.00 per powder-type copy and P.50 per liquid-type copy. It was claimed that after the said audit of the meter readings done by a certain Cliezelle Jane “Kleng” Jacinto, it was discovered that there were discrepancies in the reading reports that were submitted by [respondents] Domrique and Leaño. Susana Montano then concluded that the [respondents] conspired with each other to cheat on the meter readings in order to pocket the difference [between] their ending report and the actual meter reading. Based on the report of Jacinto and another technician by the name of Albert Alviz, from October 1-30, 2005, [respondent] Domrique allegedly pocketed P31,472.50, while [respondent] Leaño pocketed P3,501.00. On November 3, 2005, Susana Montano proceeded to the police station to have the incident recorded in the police blotter. Also, on the same day, [respondents] were each required to execute a document in the Iloco dialect entitled “Naiget Nga Kari”, which literally means Solemn Promise.
On November 4, 2005, Susana Montano issued a termination letter to [respondent] Domrique. The letter states that the company had lost its trust and confidence on [respondent] Domrique who was found to have defrauded the company by making a false meter reading report thereby incurring deficit in the amount of P15,059.00. She was also accused of having misappropriated 195 reams of bond paper. Susana Montano likewise issued on November 4, 2005, a termination letter to [respondent] Leaño informing the latter of her dismissal from employment on the ground that she also defrauded the company by making a false meter reading report thereby incurring deficit amounting to P3,501,00.
On November 9, 2005, [respondents] Domrique and Leaño filed separate complaints for illegal dismissal and money claims against [petitioners] before the Arbitration Branch of the NLRC, claiming to have been dismissed from employment, without just cause and without affording them due process.
[Respondents] essentially denied having misappropriated sums of money belonging to the company. They claimed that there was an allowed arrangement in their company that they could render photocopying services to deserving school employees wherein the payments are collected only on a weekly or monthly basis. When Susana Montano conducted an audit of their branch on November 2, 2005, it was a declared non-working holiday. As such, [respondents] still have receivables from their customers and they could not yet remit the said amounts for the same reason that it was a non-working holiday. Also, the meter readings which they submitted on October 31, 2005 necessarily resulted in discrepancies on the meter readings taken at the end of the day on November 2, 2005 because they still performed photocopying jobs in the afternoon of October 31, 2005 and on November 1-2, 2005. At any rate, they agreed to sign a document entitled “Naiget Nga Kari” wherein they promised to remit the amount of their receivables in order to put an end to the controversy. Pursuant to such promise, [respondents] Domrique and Leaño delivered to [petitioners] on November 8, 2005, the amounts of P17,000.00 and P1,600.00, respectively, which they collected from their customers. Despite compliance with their promise, [petitioners] failed to reinstate [respondents] to their positions. They were also dismissed without having been given the chance to explain their side of the controversy.
In their traverse, [petitioners] contended that [respondents] were dismissed from employment for loss of trust and confidence after it was discovered that they defrauded the company by making false meter reading report with the intention of pocketing the payments made by their clients. [Respondent] Domrique was also found to have misappropriated several reams of bond paper. The matter was duly reported to the Laoag City Police Station and a complaint for qualified theft was filed against [respondents] which is now pending before the Regional Trial Court, Branch 16, Laoag City. [Respondents] only made partial payments on November 8, 2005 but their balance remained unpaid. It was only after a thorough investigation and notices to [respondents] informing them of their infractions that [petitioners] decided to dismiss them from their employment. [Petitioners] also pointed out that [respondent] Domrique had already defrauded the company in the year 2001 but out of compassion, [petitioners] allowed her to continue with her employment.
IN VIEW THEREOF, judgment is hereby rendered declaring that the complainants were illegally dismissed. Consequently, respondent VIRGILIO MONTANO and COPY CENTRAL DIGITAL COPY SOLUTION [are] hereby directed to pay in solidum the complainants Domrique and Leaño the total amount of TWO HUNDRED FORTY-THREE THOUSAND SIX HUNDRED & 76/100 (P243,600.76), representing the underpayment of their wages, backwages and separation pay, plus 10% of the award as attorney's fees.The LA ruled that: petitioners failed to afford respondents due process because the latter were not given notice of the charges against them as well as the opportunity to explain their side before they were dismissed from their employment; the statements of petitioners' alleged witnesses who reported that respondents were involved in illegal activities are mere hearsay because they did not execute sworn statements to confirm their allegations; even respondents' written acknowledgment of their indebtedness and their separate undertakings to return the amounts due to petitioners is not substantial evidence to justify their dismissal from employment.
WHEREFORE, the petition is hereby GRANTED. The assailed Decision dated May 29, 2009 and Resolution dated August 14, 2009 of public respondent National Labor Relations Commission are hereby SET ASIDE. Accordingly, the Decision dated February 28, 2006 of the Labor Arbiter is REINSTATED.The CA held that there is insufficient evidence to prove the validity of respondents' dismissal from employment, both on the substantive and procedural aspects of the case.
1. THE COURT OF APPEALS ERRED AND MISAPPRECIATED FACTS, LAW AND ESTABLISHED JURISPRUDENCE IN CONCLUDING THAT RESPONDENTS WERE ILLEGALLY DISMISSED FROM THEIR EMPLOYMENT AS THERE WAS NO JUST CAUSE AS PROVIDED FOR BY THE LABOR LAW WHICH WOULD WARRANT THEIR DISMISSAL.Petitioners' basic contention is that respondents are guilty of theft in misappropriating the income from the photocopying machines under their care and custody and that these acts of misappropriation constitute serious misconduct and fraud or willful breach of the trust reposed in them by petitioners which are just causes for termination of employment under Article 282 of the Labor Code.
2. THE COURT OF APPEALS ERRED AND MISAPPRECIATED FACTS, LAW AND ESTABLISHED JURISPRUDENCE IN REINSTATING THE DECISION OF THE LABOR ARBITER DATED FEBRUARY 28, 2006 DESPITE THE PRESENCE OF JUST CAUSE WHICH WOULD WARRANT THE DISMISSAL OF HEREIN RESPONDENTS, THUS, NOT ENTITLED FOR WAGE DIFFERENTIALS, BACKWAGES, SEPARATION PAY AND ATTORNEY'S FEES.
Section 2. Standard of due process: requirements of notice. – In all cases of termination of employment, the following standards of due process shall be substantially observed.Jurisprudence has expounded on the guarantee of due process, requiring the employer to furnish the employee with two written notices before termination of employment can be effected: a first written notice that informs the employee of the particular acts or omissions for which his or her dismissal is sought, and a second written notice which informs the employee of the employer's decision to dismiss him. In considering whether the charge in the first notice is sufficient to warrant dismissal under the second notice, the employer must afford the employee ample opportunity to be heard.
I. For termination of employment based on just causes as defined in Article 282 of the Labor Code:(a) A written notice served on the employee specifying the ground or grounds for termination, and giving to said employee reasonable opportunity within which to explain his side;
(b) A hearing or conference during which the employee concerned, with the assistance of counsel if the employee so desires, is given opportunity to respond to the charge, present his evidence, or rebut the evidence presented against him; and
(c) A written notice [of] termination served on the employee indicating that upon due consideration of all the circumstances, grounds have been established to justify his termination.